This is a question on cap volatility market data. The quotes usually include volatilities for different strike (1%, 2%, ... 5%) and maturities (1Y,2Y,...20Y). One volatility for each combination of strike and maturity.
If I want to price a cap with, let's say, a strike of 2% and maturity in 10 years I would use the corresponding volatility from the market data described above. I think I understand it so far.
But then I also have volatility quotes for the at-the-money (ATM) rate. How do I know what the current at-the-money rate is? Second, in which situation would I use the ATM quotes?